Private capital required to meet 'very ambitious' housing targets

Chief executive of developer Glenveagh said up to €50bn may be needed

Conor Murtagh, chief financial officer, and Stephen Garvey, chief executive, of Glenveagh. 

Meeting the Government’s “very ambitious” target of building 300,000 homes by 2030 will require private capital investment to bridge the funding gap, as well as infrastructure spending of up to €10bn, the chief executive of homebuilder Glenveagh has said.

This comes as the company reported a strong performance during 2024, with turnover reaching a record level of €869m — up 43% year-on-year. The company's revenue growth was largely underpinned from its sales of homes to the State, which last year raised €120m, up from just €17m in 2023.

The group's profits before tax for the year soared by 107% to €113.8m from €55.1m in 2023.

Glenveagh, which is one of the largest residential developers in the country, said it was aiming to deliver about 3,600 new housing units on average every year out to 2029.

When asked about the Government’s 2030 housing target, Glenveagh chief executive Stephen Garvey said it was “very ambitious” but was “what the country needs”.

However, he noted one of the main impediments to reaching that target is the lack of capital available to fund projects.

“To deliver those 300,000 units, the country needs, one way or another, about €150bn in capital. That's mortgages, that's debt, that's equity, that's customers deposits,” he said.

In our estimation, if you apply what the Government can do, and you apply what the banks can do, and you provide what the cash is available from consumers who are purchasing, you're short, give or take, somewhere between €40bn and €50bn.

Mr Garvey said private capital would be required to bridge that funding gap but “how we get that private capital to come in and work but still accommodate everything that society wants is going to be a challenge”.

Capacity an issue

He added capacity also remained an issue, as serviced land and infrastructure was needed to build.

"We need to invest, give or take, probably over the next number of years, somewhere between €7bn to €10bn in infrastructure,” he said.

On Wednesday, the Central Statistics Office (CSO) released data showing planning permission for homes fell off a cliff last year, dropping 21% compared to 2023. This was largely driven by a 39% drop in apartments being approved for construction.

Mr Garvey said the issue with apartments was that “viability is a fundamental challenge” given the working capital needed to fund the project as well as the construction costs.

He said there were not really many institutional capital investors buying apartments now due to concerns over returns on investment or tying up their capital for long periods of time.

I know a lot of debate about rent pressure zones, but those have prohibited the amount of apartments that have been delivered, and that would tally up with why planning permissions are probably going down. 

During 2024, Glenveagh completed the construction of 2,415 homes, compared to 1,363 the previous year. In addition, it secured planning permission for about 2,487 units, ensuring all targeted output for 2025 was fully approved.

Glenveagh also bought 14 sites in 2024, with deals worth a combined €285m and holding capacity for about 9,000 additional homes.

In its forecast for the current year, Glenveagh said demand for homes “remains exceptionally strong” with the company's forward order book totalling €1.1bn, up 35% compared to March 2024.

Glenevagh’s full-year report added the company was expected to exceed 1,500 home deliveries in 2025.